Planning for the future is an important step for every California adult. Estate planning is specific to the needs and objectives of the individual, which may include the desire to designate a portion of the estate for charitable giving. While drafting a will is a basic step in many estate plans, there are better and more effective ways to give through an estate after death. There are specific estate planning tools that can help accomplish that goal.
It is possible to give to charities by including provisions in an estate plan that directly transfer valuable stocks to a charity. This can happen during a stockholder’s lifetime, and this will provide certain tax incentives for charitable giving. However, selling stock and then giving the proceeds to charity could result in tax penalties. Another option is to donate through a charitable organization directly from an IRA.
A California adult who has the goal of giving to charity through his or her estate plan can also leave money to a charity directly through a will or by establishing a revocable trust. When including these types of terms in an estate plan, it is prudent to make sure that the name of the charity is correct and everything is accurate. Mistakes could cause complications when it’s time to transfer assets to a specific place.
Giving to charity is a common estate planning objective. When drafting plans, it may help to discuss this desire with an experienced attorney who can help meet this goal and protect the interests of beneficiaries. Before making any decisions, it is helpful to understand the tax implications and benefits of any charitable giving options.